Oil prices climbed on Thursday, recovering part of the previous session’s steep losses, as investors assessed shifting signals around a potential peace deal in the Middle East.
Crude Benchmarks Rebound
Brent crude futures rose 78 cents (0.8%) to $102.05 per barrel at 0400 GMT, while U.S. West Texas Intermediate (WTI) gained 76 cents (0.8%) to $95.84 per barrel.
Both benchmarks had fallen more than 7% a day earlier, hitting two-week lows on optimism over a possible de-escalation in regional conflict.
Volatile Sentiment Driven by Diplomacy
Market sentiment has swung sharply as diplomatic signals emerge from ongoing discussions involving the United States and Iran.
While talks continue, uncertainty remains over key issues, including nuclear restrictions and strategic maritime routes such as the Strait of Hormuz.
A mediation source cited that negotiations are progressing toward a brief framework agreement, though no final deal has been confirmed.
Analysts Warn of Continued Volatility
Market analysts said oil prices are likely to remain sensitive to political developments.
They noted that any breakthrough peace agreement could sharply reduce geopolitical risk premiums, leading to a steep price correction. However, renewed tensions or attacks on energy infrastructure could trigger another rapid price surge.
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Supply Concerns Still in Focus
Even if a deal materializes, analysts expect near-term supply constraints to persist due to logistical delays in restoring oil flows from the Gulf region.
Meanwhile, U.S. crude inventories continued to decline last week, reflecting ongoing supply pressure. According to the U.S. Energy Information Administration (EIA), crude stocks fell by 2.3 million barrels to 457.2 million barrels.
Market Outlook
Experts say oil markets remain caught between diplomacy and disruption, with prices reacting sharply to every development in the Middle East peace process, leaving short-term outlooks highly uncertain.
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